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ESSO v. CIR, 175 SCRA 149 (1989)
ESSO v. CIR, 175 SCRA 149 (1989)
*
G.R. Nos. 28508-9. July 7, 1989.
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* FIRST DIVISION.
150
151
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CRUZ, J.:
On appeal
1
before us is the decision of the Court of Tax
Appeals denying petitioner’s claims for refund of overpaid
income taxes of P102,246.00 for 1959 and P434,234.93 for
1960 in CTA Cases No. 1251 and 1558 respectively.
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II
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2 22 SCRA 779.
156
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3 14 SCRA 630.
157
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for the remittance of funds after they have already been earned by
petitioner’s branch in the Philippines for the disposal of its Head
Office in New York which is already another distinct and separate
income taxpayer.
xxx
Since the margin fees in question were incurred for the
remittance of funds to petitioner’s Head Office in New York,
which is a separate and distinct income taxpayer from the branch
in the Philippines, for its disposal abroad, it can never be said
therefore that the margin fees were appropriate and helpful in the
development of petitioner’s business in the Philippines exclusively
or were incurred for purposes proper to the conduct of the affairs
of petitioner’s branch in the Philippines exclusively or for the
purpose of realizing a profit or of minimizing a loss in the
Philippines exclusively. If at all, the margin fees were incurred for
purposes proper to the conduct of the corporate affairs of
Standard Vacuum Oil Company in New York, but certainly not in
the Philippines.
ESSO has not shown that the remittance to the head office
of part of its profits was made in furtherance of its own
trade or business. The petitioner merely presumed that all
corporate expenses are necessary and appropriate in the
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160
Decision affirmed.
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